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HomeMy WebLinkAbout2022-04-13 CVBFFA Agenda PacketChula Vista Bayfront Facilities Financing Authority San Diego Unified Port District Meeting Agenda 3165 Pacific Hwy. San Diego, CA 92101 Don L. Nay Port Administration Boardroom3:00 PMWednesday, April 13, 2022 Port of San Diego Don L. Nay Port Administration Boardroom 3165 Pacific Highway San Diego, CA 92101 ****Pursuant to Assembly Bill 361 and state or local officials’ continued recommend measures to promote social distancing in response to the COVID -19 pandemic, the CHULA VISTA BAYFRONT FACILITIES FINANCING AUTHORITY (AUTHORITY) hereby provides notice that it will hold a regular meeting of the BOARD OF DIRECTORS OF THE AUTHORITY (BOARD). Some of the Directors may attend the meeting and participate remotely to the same extent as if they were present. The public is welcome to attend in person, or alternatively. MEMBERS OF THE PUBLIC MAY VIEW THIS MEETING VIA LIVESTREAM at: https://portofsandiego.legistar.com/Calendar.aspx PROVIDING PUBLIC COMMENT Public comment is limited to 2 minutes per speaker on both agenda, and non -agenda items. The time allotted for speakers may be adjusted by the Board Chair at his or her discretion. PUBLIC COMMENT IS AVAILABLE FOR THIS MEETING DOING ONE OF THE FOLLOWING NO LATER THAN THE TIME THE PUBLIC COMMENT PORTION FOR THE AGENDA ITEMS IS CONCLUDED, HOWEVER THE PUBLIC IS STRONGLY ENCOURAGED TO DO SO PRIOR TO THE ITEM BEING CALLED: In-Person Participation: Complete and submit a Speaker Slip and give to the District Clerk. Remote Participation: 1. Call 619-736-2155 and leave a brief voicemail message that will be played during the meeting. A voicemail longer than the time allotted for public comment on that item will be stopped after that time has elapsed. 2. Email a request to provide live comments to PublicRecords@portofsandiego .org to receive a link to participate in the meeting to provide live comments. * 3. Submit written comments to PublicRecords@portofsandiego .org which will be forwarded to the Board and included in the agenda-related materials record for the meeting. Page 1 San Diego Unified Port District Printed on 4/8/2022 April 13, 2022Chula Vista Bayfront Facilities Financing Authority Meeting Agenda * Neither the San Diego Unified Port District nor the Authority are responsible for the member of the public’s internet connections or technical ability to participate in the meeting. It is highly recommended that you use voicemail rather than provide live comment. In keeping with the Americans with Disabilities Act (ADA), the Authority and San Diego Unified Port District will make every reasonable effort to encourage participation in all its public meetings. If you require assistance or auxiliary aids in order to participate at this public meeting, please contact the Office of the District Clerk at publicrecords@portofsandiego .org or (619) 686-6206 at least 48 hours prior to the meeting. Board of Directors Honorable City of Chula Vista Mayor Mary Casillas Salas City of Chula Vista Councilman Stephen Padilla Port Commissioner Ann Moore Port Commissioner Rafael Castellanos Port Commissioner Dan Malcolm A.Call to Order B.Roll Call C.Non-Agenda Public Comment Each individual speaker is limited to two (2) minutes D.Consent Items None. E.Action Items Resolution: 1.Selecting the Chair and Vice Chair and Confirming the Designation of Other Officers of the Chula Vista Bayfront Facilities Financing Authority (Authority) 2.Authorizing the Execution and Delivery of a Letter Agreement for the Payment of Legal Services to Chapman and Cutler LLP in Conjunction with the Issuance by the Authority of Certain Bonds to Finance a Portion of the Cost of the Convention Center and the Phase 1A Infrastructure Improvements for the Chula Vista Bayfront 3.Authorizing Changes to the Day and Frequency of the Regular Meetings of the Board of Directors to Add May 12, 2022 and May 13, 2022 as Regular Meetings, and to Establish the Location of the May 12, 2022 and May 13, 2022 Regular Meetings 4.Regarding District Virtual Meetings in Accordance with The Ralph M. Brown Act and Assembly Bill 361 Page 2 San Diego Unified Port District Printed on 4/8/2022 April 13, 2022Chula Vista Bayfront Facilities Financing Authority Meeting Agenda F.Staff Comments G.Board Comment H.Adjournment Page 3 San Diego Unified Port District Printed on 4/8/2022 DATE: April 13, 2022 SUBJECT: RESOLUTION: (A) SELECTING THE CHAIR AND VICE CHAIR AND CONFIRMING THE DESIGNATION OF THE OTHER OFFICERS OF THE CHULA VISTA BAYFRONT FACILITIES FINANCING AUTHORITY (AUTHORITY) (B) AUTHORIZING THE EXECUTION AND DELIVERY OF A LETTER AGREEMENT FOR THE PAYMENT OF LEGAL SERVICES TO CHAPMAN AND CUTLER LLP IN CONJUNCTION WITH THE ISSUANCE BY THE AUTHORITY OF CERTAIN BONDS TO FINANCE A PORTION OF THE COST OF THE CONVENTION CENTER AND THE PHASE 1A INFRASTRUCTURE IMPROVEMENTS FOR THE CHULA VISTA BAYFRONT (C) AUTHORIZING CHANGES TO THE DAY AND FREQUENCY OF THE REGULAR MEETINGS OF THE BOARD OF DIRECTORS OF THE AUTHORITY TO ADD MAY 12, 2022 AND MAY 13, 2022 AS REGULAR MEETINGS, AND TO ESTABLISH THE LOCATION OF THE MAY 12, 2022 AND MAY 13, 2022 REGULAR MEETINGS (D) REGARDING AUTHORITY VIRTUAL MEETINGS IN ACCORDANCE WITH THE RALPH M. BROWN ACT AND CALIFORNIA ASSEMBLY BILL 361 EXECUTIVE SUMMARY: The Chula Vista Bayfront Facilities Financing Authority (Authority) was formed through that certain Joint Exercise of Powers Agreement between the City of Chula Vista (City) and the San Diego Unified Port District (District) dated as of May 1, 2014 and filed in the Office of the District Clerk as Document No. 61905 (Original Authority Agreement), as amended and restated by that certain Amended and Restated Joint Exercise of Powers Agreement between the City and District dated July 25, 2019 and filed in the Office of the District Clerk as Document No. 70245 (Authority Agreement). The District and the City (each, a Member of the Authority) are the sole members of the Authority. The District and the City have been working collaboratively for decades to plan and implement the Chula Vista Bayfront Master Plan (CVBMP). Since 2014, the District and the City have been working to deliver the catalyst project for the CVBMP, an approximately 275,000 net usable square foot convention center (Convention Center) and a 1,570 to 1,600 room resort hotel (Resort Hotel) to be located on Parcel H3 of the CVBMP. The project also requires the construction of extensive public infrastructure to the areas surrounding Parcel H3 (Phase 1A Infrastructure Improvements). Page 2 of 9 RIDA Chula Vista, LLC (RIDA) was selected as the developer of the Convention Center and the Resort Hotel through a Request for Qualifications. At the early stages, and in light of an overall project cost in excess of $1.1 billion, it was determined that in order for the Convention Center and Phase 1A Infrastructure Improvements to be financially feasible, the City and the District would need to make a “Public Contribution” for the construction of the Convention Center and Phase 1A Infrastructure Improvements. The Public Contribution consists of approximately $265MM toward the cost of the Convention Center and approximately $85MM toward the Phase 1A Infrastructure Improvements for a total public investment of $350MM. The Authority was formed to finance most of the Public Contribution. In support of the Public Contribution, the Authority is negotiating with J.P. Morgan Securities LLC (JPMorgan) to extend credit to the Authority through the purchase of bonds (Authority Bonds) that will be secured by funds provided by the District, the City, and the Bayfront Project Special Tax Financing District (Special Tax District). Additional funding to cover the amounts not financed will be provided through grants, a contribution of $25MM from the County of San Diego through the County Agreement (defined below), a sewer contribution from the City, a contribution through the City’s Bayfront Development Impact Fee (BFDIF) program, and funds from the District that have been collected over time through various projects on the Chula Vista Bayfront, including a contribution from the North C.V. Waterfront L.P. (Pacifica). At the April 13 regular meeting of the Board of Directors of the Authority (Authority Board), as the first order of business, pursuant to the Authority Agreement and Bylaws of the Authority (Authority Bylaws), the Authority Board will select the Chair and Vice Chair and confirm the other officers of the Authority. The Honorable Mayor Mary Casillas Salas is currently the Chair and Port Commissioner Ann Moore is currently the Vice Chair. Mayor Casillas Salas and Commissioner Moore may be selected to serve in these positions again or other members of the Authority Board may be selected to serve in these positions. Each of the Chair and Vice Chair will serve as Chair and Vice Chair respectively from the date of his or her election through the date of the first meeting of the Authority in the next succeeding calendar year; provided that each shall serve as Chair or Vice Chair, as applicable, until a successor has been duly selected. The other officers of the Authority are currently as follows: Executive Director (District CEO/President and designees), Auditor (City Director of Finance and designees), Treasurer (City Director of Finance and designees), and Secretary (District Clerk and designees). Second, the Authority Board will be considering the approval of a letter agreement with Chapman and Cutler LLP (Chapman & Cutler) for payment of legal services (C&C Letter Agreement) (Attachment A). In conjunction with the Authority Bonds, JPMorgan engaged Chapman & Cutler to serve as legal counsel to the lenders, including JPMorgan as the Lead Arranger and Administrative Agent of the Authority Bonds. Under the C&C Letter Agreement, the Authority agrees to pay Chapman & Cutler’s a maximum of $425,000 if there is a successful financial close no later than May 31, 2022 and a maximum $250,000 if the financial close is not achieved. The maximum amounts for the fees can be increased by $75,000 for each month of delay (prorated for any partial month) beyond May 31, 2022. Further, if there is impasse resulting from a requirement of JPMorgan that the Authority, the District, and the City are not legally permitted to do, and the result of that impasse is Page 3 of 9 a failure to achieve a successful financial close, the Authority does not have to pay Chapman & Cutler their legal fees. The caps include routine copying charges, postage and internal secretarial services. The caps do not include other services, such as travel, filing and search fees. Third, the Authority Board will be considering a change to the day and frequency of the regular meetings of the Authority Board. Pursuant to Section 4.C(1) of the Authority Agreement, the Authority Board shall hold its regular meetings at such times and at such locations as may be established by the Bylaws or by resolution of the Authority Board. The Bylaws of the Authority do not establish a schedule for the regular meetings. On December 13, 2021, the Authority Board adopted Resolution No. 2021-004 which provides that the Authority Board shall hold a regular meeting every Wednesday of each month, commencing January 1, 2022, and establishes the location of the regular meetings as the City of Chula Vista located at 276 Fourth Avenue, Chula Vista, California 91910 for the first and third meetings of each month and the San Diego Unified Port District, Don L. Nay Administration Building located at 3165 Pacific Highway, San Diego, California 92101 for the second, fourth, and fifth meetings of each month. Resolution No. 2021-004 did not change the time of the regular meetings which continues to be 3:00 pm. The proposed Authority Board action would add May 12, 2022 and May 13, 2022 as regular meeting dates and such regular meetings would be held at the San Diego Unified Port District, Don L. Nay Administration Building located at 3165 Pacific Highway, San Diego, California 92101. Finally, California Assembly Bill 361 (AB 361) enacted certain exceptions to the Ralph M. Brown Act (Brown Act) to allow virtual and hybrid meetings of the public agencies when there is a proclaimed state of emergency and state or local officials are recommending measures to promote social distancing. The April 13, 2022 Authority Board meeting will be held at San Diego Unified Port District, Don L. Nay Administration Building located at 3165 Pacific Highway, San Diego, California 92101. On March 4, 2020, the Governor declared a state of emergency related to COVID-19 which still remains in effect. The District declared a state of emergency on March 18, 2020 which remains in effect. In addition to other social distancing recommendations by state, federal, and local agencies, on September 23, 2021, Wilma J. Wooten, the Public Health Officer for the County of San Diego, issued a Health Officer Teleconference Recommendation which recommends continued virtual Brown Act meetings to help prevent the spread of COVID-19. Staff recommends that the Authority Board adopt the resolution selecting the chair and vice chair and confirming the other officers, authorizing the execution and delivery of the C&C Letter Agreement, and authorizing changes to the day and frequency of the regular meetings of the Authority Board to add May 12, 2022 and May 13, 2022 as regular meetings and to establish the location of the May 12, 2022 and May 13, 2022 regular meetings. In addition, staff recommends that the Authority Board adopt a resolution making the finding that, based on continued state, federal, and local recommendations for social distancing, the Brown Act meetings of the Authority Board held in accordance with the Brown Act are permitted to use the exceptions to Brown Act rules set forth in AB Page 4 of 9 361. And further, that this authorization expires if not renewed at the following regular meeting of the Authority Board. RECOMMENDATION: (A) ADOPT THE RESOLUTION: (1) SELECTING THE CHAIR AND VICE CHAIR AND CONFIRMING THE DESIGNATION OF THE OTHER OFFICERS OF THE AUTHORITY; (2) AUTHORIZING THE EXECUTION AND DELIVERY OF THE C&C LETTER AGREEMENT; (3) AUTHORIZING CHANGES TO THE DAY AND FREQUENCY OF THE REGULAR MEETINGS OF THE AUTHORITY BOARD TO ADD MAY 12, 2022 AND MAY 13, 2022 AS REGULAR MEETINGS, AND TO ESTABLISH THE LOCATION OF THE MAY 12, 2022 AND MAY 13, 2022 REGULAR MEETINGS; AND (4) MAKING FINDINGS REGARDING AUTHORITY BOARD VIRTUAL MEETINGS IN ACCORDANCE WITH THE BROWN ACT AND AB 361. FISCAL IMPACT: The requested Authority Board action (1) selecting the chair and vice chair of the Authority Board and confirming the designation of the other officers of the Authority; (2) authorizing changes to the day and frequency of the regular meetings of the Authority Board to add May 12, 2022 and May 13, 2022 as regular meetings, and to establish the location of the May 12, 2022 and May 13, 2022 regular meetings; and (3) regarding the designation of Authority virtual meetings in accordance with the Brown Act and AB 361, will not result in a direct fiscal impact to the Authority, as the Authority Board’s current actions do not authorize the use of public funds and the Authority Agreement provides for a mechanism for the District and the City to recover the cost of services performed by the officers who are employed by the District and the City, as applicable. The requested Authority Board action to authorize the execution and delivery of the C&C Letter Agreement may result in a fiscal impact of up to $425,000 if the financial close is achieved not later than May 31, 2022 and may be increased by $75,000 for each month of delay beyond May 31, 2022. In the event financial close of this transaction is not achieved, Chapman & Cutler’s legal fees will be capped at $250,000. In the event of any delay (except for the reason set forth in the last paragraph of this Fiscal Impact section) beyond May 31, 2022, to compensate Chapman & Cutler for any inefficiencies caused by such delay, Chapman & Cutler’s fee cap will be increased by $75,000 for each month of delay (or prorated for any partial month). The caps include routine copying charges, Page 5 of 9 postage and internal secretarial services, but do not include other services such as travel, filing and search fees. In the event of a successful financial close, the Authority is required to pay Chapman & Cutler at the financial close provided they provide the Authority with an invoice at least two days in advance of financial close, and if not submitted at least two days in advance of financial close, then not later than thirty (30) days following receipt of their invoice. In the event financial close of the transaction is not achieved, upon receipt of notice from the Authority that it is no longer pursuing financial close of the transaction, Chapman & Cutler will deliver an invoice with the fees incurred to date and subject to the limitations set forth in the following paragraph, the Authority will pay the invoice within thirty (30) days of receipt. The Authority will have an opportunity to review Chapman & Cutler’s invoice and Chapman and Cutler agrees to respond to any questions regarding fees and work in good faith with the Authority to resolve any issues related to the fees. Chapman & Cutler also agrees that if there is an impasse resulting from a requirement of JPMorgan that the Authority, District, and City are not legally permitted to do, and the result of that impasse is a failure to achieve a successful financial close, the Authority will not be obligated to pay Chapman & Cutler. DISCUSSION: It is contemplated that JPMorgan will act as Lead Arranger and Administrative Agent under a Bond Purchase and Continuing Covenant Agreement among the Authority, JPMorgan, as Administrative Agent, and the other lenders that are party thereto (collectively, the “Lenders”), pursuant to which the Lenders will extend credit to the Authority by purchasing the Authority Bonds under a draw-down structure. The Authority will use the credit to finance the Public Contribution. The total estimated cost to construct the Convention Center and the Phase 1A Infrastructure Improvements is $425,000,000. Approximately $286,500,000 of this amount will be funded from the proceeds of the Authority Bonds, approximately $21,500,000 of which will be applied to fund the construction of the Phase 1A Infrastructure Improvements and approximately $265MM of which will be applied to fund the construction of the Convention Center. I. Selection of Officers The officers of the Authority are the Chair, Vice Chair, Secretary, Executive Director, Treasurer, and the Auditor. Under Section 3.3 of the Authority Bylaws, the Chair and Vice Chair of the Authority are to be selected as the first order of business at the first regular or special meeting of the Authority held in each calendar year. Since this is the first regular meeting of the Authority Board held in this calendar year, the Chair and Vice Chair must be selected and designation of the remaining officers must also be confirmed. Staff recommends that the Authority Board select the Authority Board Chair and Vice Chair, Page 6 of 9 confirm the designation of the other officers, and consider the balance of the agenda action items. II. C&C Letter Agreement The Authority Board will be considering the approval of the C&C Letter Agreement. In conjunction with the Authority Bonds, JPMorgan engaged Chapman & Cutler to serve as legal counsel to the Lenders, including JPMorgan as the Lead Arranger and Administrative Agent of the Authority Bonds. Under the C&C Letter Agreement, the Authority agrees to pay Chapman & Cutler’s a maximum of $425,000 if there is a successful financial close no later than May 31, 2022 and a maximum $250,000 if the financial close is not achieved. The maximum amounts for the fees can be increased by $75,000 for each month of delay (prorated for any partial month) beyond May 31, 2022. If there is impasse resulting from a requirement of JPMorgan that the Authority, the District, and the City are not legally permitted to do, and the result of that impasse is a failure to achieve a successful financial close, the Authority does not have to pay Chapman & Cutler their legal fees. The caps include routine copying charges, postage and internal secretarial services. The caps do not include other services, such as travel, filing and search fees. III. Date and Frequency of Regular Meetings of the Authority Board Pursuant to Section 4.C(1) of the Authority Agreement, the Authority Board shall hold its regular meetings at such times and at such locations as may be established by the Bylaws or by resolution of the Authority Board. The Bylaws of the Authority do not establish a schedule for the regular meetings. On December 13, 2021, the Authority Board adopted Resolution No. 2021-004 which provides that the Authority Board shall hold a regular meeting every Wednesday of each month, commencing January 1, 2022, and establishes the location of the regular meetings as the City of Chula Vista located at 276 Fourth Avenue, Chula Vista, California 91910 for the first and third meetings of each month and the San Diego Unified Port District, Don L. Nay Administration Building located at 3165 Pacific Highway, San Diego, California 92101 for the second, fourth, and fifth meetings of each month. Resolution No. 2021-004 did not change the time of the regular meetings which continues to be 3:00 pm. To better facilitate the business of the Authority Board, staff recommends the Authority Board add May 12, 2022 and May 13, 2022 as regular meetings of the Authority Board, in addition to the current regular meetings held every Wednesday of each month. Adoption of the proposed resolution would change the day and frequency of meetings to add May 12, 2022 and May 13, 2022, effective April 13, 2022. The two new meetings would take place at 3165 Pacific Highway, San Diego, California 92101. The meeting time of all regular meetings will continue to be at 3:00 pm. IV. Authority Board Virtual Meetings in Accordance with the Brown Act and AB 361 AB 361 enacted certain exceptions to the Brown Act to allow virtual and hybrid meetings of the public agencies when there is a proclaimed state of emergency and state or local officials are recommending measures to promote social distancing. On March 4, 2020, Page 7 of 9 the Governor declared a state of emergency related to COVID-19 which still remains in effect. The District declared a state of emergency on March 18, 2020 which remains in effect. Several state, federal, and local agencies continue to recommend social distancing to prevent the spread of COVID-19. For example: • On September 23, 2021, Wilma J. Wooten, the Public Health Officer for the County of San Diego, issued a Health Officer Teleconference Recommendation which recommends continued virtual Brown Act meetings to help prevent the spread of COVID- 19. • Cal-OSHA adopted temporary emergency standards for workplaces that do not require social distancing but do require employers to provide effective training and instruction to employees that includes “The fact that particles containing the virus can travel more than six feet, especially indoors, so physical distancing, face coverings, increased ventilation indoors, and respiratory protection decrease the spread of COVID- 19, but are most effective when used in combination.” [Available at: https://www.dir.ca.gov/dosh/coronavirus/ETS.html.] • The California Department of Healthcare Services, which administers the state’s Medi-Cal program provides the following in its Frequently Asked Questions for Medi-Cal beneficiaries: “Even after being vaccinated, people will still need to practice other precautions, like wearing a mask, social distancing, handwashing, and other hygiene measures, until public health officials say otherwise.” [Available at https://www.dhcs.ca.gov/Pages/COVID-19-Vaccines.aspx.] • The California Department of Public Health has issued guidance about additional vaccine doses for persons who are immunocompromised. The guidance contains the following: “As a person with a weak immune system, once I get an additional dose, can I reduce the use of other precautions such as masking, distancing, and avoiding groups and crowds.” A: “No, because even with an extra dose of mRNA vaccine, not everyone with a compromised immune system appears to mount a normal immune response. We are still learning about this, but at this time, we consider it prudent to continue taking extra precautions.” [Available at: https://www.cdph.ca.gov/Programs/CID/DCDC/Pages/COVID- 19/ThirdVaccineDoseQandA.aspx.] Therefore, staff recommends the Authority Board adopt a resolution making the finding that, based on continued state, federal, and local recommendations for social distancing, the Brown Act meetings of the Authority Board are permitted to use the exceptions to Brown Act rules set forth in AB 361. And further, that this authorization expires if not renewed at the next regular meeting of the Authority Board that is not cancelled. Page 8 of 9 As more fully discussed above, staff recommends that the Authority Board: (A) Select the Chair and Vice Chair and Confirm the Designation of the Other Officers of the Authority; (B) Authorize the Execution and Delivery of the C&C Letter Agreement; (C) Authorize the Change to the Day and Frequency of the Regular Meetings of the Authority Board to Add May 12, 2022 and May 13, 2022 as Regular Meetings, and to Establish the Location of the May 12, 2022 and May 13, 2022 Regular Meetings; and (D) Make Findings Regarding Authority Board Virtual Meetings in Accordance with the Brown Act and AB 361. Co-Counsel’s Comments: Each Co-Counsel has reviewed this agenda sheet and Attachment A as presented to him or her and approve each as to form and legality. Environmental Review: The proposed actions are to adopt a Resolution selecting the Chair and Vice Chair and confirming the designation of the other officers of the Authority, authorizing the execution and delivery of the C&C Letter Agreement, authorizing the change to the day and frequency of the regular meetings, and making findings regarding Authority Board Virtual Meetings in Accordance with the Brown Act and AB 361. The proposed actions do not constitute a “project” under the definition as set forth in the California Environmental Quality Act (CEQA Guidelines § 15378(b)(2)) because they will not have a potential to result in a direct or indirect physical change in the environmental and are, therefore, not subject to CEQA. No further action under CEQA is required. In addition, the proposed Authority Board actions would not conflict with the Port Act of the District or the Public Trust Doctrine. Finally, the proposed actions do not allow for “development,” as defined in Section 30106 of the California Coastal Act, or “new development,” pursuant to Section 1.a. of the District’s Coastal Development Permit Regulations. Therefore, issuance of a Coastal Development Permit or exclusion is not required. Diversity, Equity, and Inclusion (DEI) Program: This agenda sheet has no direct DEI impact on contracting or workforce reporting at this time. PREPARED BY: Page 9 of 9 Adam Meyer Assistant Director, Real Estate, District Attachment(s): Attachment A: C&C Letter Agreement Attachment A_Chula Vista Engagement Letter[FINAL] April __, 2022 Chula Vista Bayfront Facilities Financing Authority P.O. Box 5296 Chula Vista, California 91912 Ladies and Gentlemen: As you know, we have been engaged by JPMorgan Chase Bank, National Association (“JPMorgan”), to act as lender’s counsel in connection with the issuance by the Chula Vista Bayfront Facilities Financing Authority (the “Authority”) of those certain (i) Chula Vista Bayfront Facilities Financing Authority Revenue Bonds (Chula Vista Bayfront Convention Center), Series 2022A (Federally Taxable) and (ii) Chula Vista Bayfront Facilities Financing Authority Revenue Bonds (Chula Vista Bayfront Phase 1A Infrastructure Improvements), Series 2022B (Tax-Exempt) (collectively, the “Bonds”), the proceeds of which will be used to finance a portion of the cost of the Convention Center and the Phase 1A Infrastructure Improvements, respectively, which comprise a portion of the Resort Hotel, Convention Center, Parking Improvements and Phase 1A Infrastructure Improvements referred to collectively as the “Chula Vista Bayfront Project.” It is contemplated that JPMorgan will act as Lead Arranger and Administrative Agent under a Bond Purchase and Continuing Covenant Agreement among the Authority, JPMorgan, as Administrative Agent, and the other lenders that are party thereto (collectively, the “Lenders”), pursuant to which the Lenders will extend credit to the Authority by purchasing the Bonds under a draw-down structure. We expect the scope of work under this engagement will consist of the following: • Review and, as appropriate, negotiate and revise the various financing documents related to the Bonds, including, without limitation, the Project Implementation Agreement, including the exhibits thereto, the Ground Lease, the Site Lease, the Facility Lease, the Sublease, the Loan Agreement, the Support Agreement, the Indenture and the Bonds (collectively, the “Financing Documents”), the parties to which include, without limitation, the City of Chula Vista, the San Diego Unified Port District, the Bayfront Project Special Tax Financing District and the Authority (collectively, the “Public Entities”), to incorporate any changes required to achieve a successful financial closing of the Bonds. • Review the Building Loan Agreement, the proceeds of which will be used to finance that portion of the Chula Vista Bayfront Project not being financed by the Bonds, together with various documents related thereto. Attachment A Page 1 of 4 A 2 • Perform customary due diligence with respect to the foregoing, together with a review of relevant statutory and other authorization evidencing the power and authority of the Public Entities to enter into their respective Financing Documents. • Prepare, revise and negotiate the Bond Purchase and Continuing Covenant Agreement, the parties to which will be the Authority, JPMorgan, as Administrative Agent, and the Lenders, which Bond Purchase and Continuing Covenant Agreement will set forth the obligation of the Lenders to extend credit to the Authority by making Advances under the “draw-down” Bonds and the terms and conditions thereof, as well as the various agreements and undertakings of the Authority. • Prepare, revise and negotiate the Guaranty from a RIDA related entity or person, as well as an Intercreditor Agreement among the lenders under the Bond Purchase and Continuing Covenant Agreement and the Building Loan Agreement regarding certain remedies resulting from non-performance by RIDA Chula Vista, LLC under the Financing Documents. • Review and negotiate the various enforceability, validity and, to the extent applicable, tax opinions, closing certificates and other deliverables with regard to the Financing Documents. While our client will be JPMorgan as Lead Arranger and Administrative Agent, we will be advising the other Lenders as well. Our fees for the work performed above will be for the account of the Authority and will be charged at our standard hourly rates. While our fees are difficult to estimate at this stage of our engagement, in the event of a successful financial close of this transaction not later than May 31, 2022, our fees will be capped at $425,000. In the event financial close of this transaction is not achieved, our fees will be capped at $250,000. In the event of successful financial close, we will be paid at financial close provided our invoice is submitted to you at least two days in advance of financial close, and if not submitted at least two days in advance of financial close, then not later than thirty (30) days following receipt of our invoice. In the event financial close of this transaction is not achieved, we will cease work upon receipt of notice (via email or phone) from the Authority that the Authority is no longer pursuing the financial close of this transaction. Upon receipt of such notice from the Authority, we will deliver an invoice with fees incurred to date and subject to the limitations set forth in the following paragraph, the Authority shall pay the invoice within thirty (30) days of receipt. Our fees are inclusive of work performed pursuant to this letter for JPMorgan as Lead Arranger and Administrative Agent of the Bonds and the Lenders. Our fees are exclusive of anything payable to Ashurst in advising JPMorgan and this letter does not commit the Public Entities to pay any fees to Ashurst. The Authority shall have an opportunity to review our invoice and we agree to respond to any questions regarding fees and work in good faith with the Authority to resolve any issues related to the fees. We agree that if we reach an impasse resulting from a requirement of JPMorgan that the Public Entities are not legally permitted to do, and the result of that impasse is a failure to achieve a successful financial close, we will not be paid by the Authority. In the event of any delay (except for the reason set forth in the immediately preceding paragraph) beyond May 31, 2022, to compensate us for any inefficiencies caused by such delay, Attachment A Page 2 of 4 A 3 our fee cap will be increased by $75,000 for each month of delay (or prorated for any partial month). The above caps are inclusive of routine copying charges, postage and internal secretarial services. Other expenses, such as filing and search fees, if any, will be in addition to the capped amounts and charged at cost (without any mark-up) and will be fully itemized on our invoice. We will not incur any out-of-town travel without your approval, and any such expenses will also be charged at cost and fully itemized on our invoice. By signing and returning this letter, from and after the successful closing of this transaction, you agree to allow our firm to describe in a general way in its marketing and other promotional materials the nature of our representation. If the foregoing is acceptable to you, please arrange for a copy of this letter to be executed and returned to my attention by e-mail at your earliest convenience. We look forward to working with you and your counsel and the rest of the financing team, as well as a smooth and successful transaction. If you have any questions or would like to discuss this letter, please do not hesitate to contact me. Very truly yours, CHAPMAN AND CUTLER LLP By: ____________________________________ Accepted as of the date first written above. CHULA VISTA BAYFRONT FACILITIES FINANCING AUTHORITY By: _________________________________ Name: Title: Executive Director APPROVED AS TO FORM AND LEGALITY: __________________________________ Co-Counsel, Thomas A Russell, General Counsel of the San Diego Unified Port District Attachment A Page 3 of 4 A 4 __________________________________ Co-Counsel, Glen Googins, City Attorney of the City of Chula Vista Attachment A Page 4 of 4 A DRAFT Page 1 of 3 CHULA VISTA BAYFRONT FACILITIES FINANCING AUTHORITY RESOLUTION 20xx-xxx RESOLUTION SELECTING THE CHAIR AND VICE CHAIR AND CONFIRMING THE DESIGNATION OF THE OTHER OFFICERS OF THE CHULA VISTA BAYFRONT FACILITIES FINANCING AUTHORITY WHEREAS, the Chula Vista Bayfront Facilities Financing Authority (“Authority”) was formed through that certain Joint Exercise of Powers Agreement between the City of Chula Vista (“City”) and the San Diego Unified Port District (“District”) dated as of May 1, 2014 and filed in the Office of the District Clerk as Document No. 61905 (“Original Authority Agreement”), as amended and restated by that certain Amended and Restated Joint Exercise of Powers Agreement between the City and District dated July 25, 2019 and filed in the Office of the District Clerk as Document No. 70245 (“Authority Agreement”); and WHEREAS, the District and the City (each, a “Member of the Authority”) are the sole members of the Authority; and WHEREAS, the officers of the Authority are the Chair, Vice Chair, Secretary, Executive Director, Treasurer, and the Auditor; and WHEREAS, at the April 13, 2022 regular meeting of the Board of Directors of the Authority (“Authority Board”), as the first order of business, pursuant to the Authority Agreement and Bylaws of the Authority (“Authority Bylaws”), the Authority Board will select the Chair and Vice Chair and confirm the other officers of the Authority; and WHEREAS, the Honorable Mayor Mary Casillas Salas is currently the Chair and Port Commissioner Ann Moore is currently the Vice Chair; and WHEREAS, under Section 3.3 of the Authority Bylaws, the Chair and Vice Chair of the Authority are to be selected as the first order of business at the first regular or special meeting of the Authority held in each calendar year; and WHEREAS, since April 13, 2022 is the first regular meeting of the Authority Board held in this calendar year, the Chair and Vice Chair must be selected and designation of the remaining officers must also be confirmed; and WHEREAS, Mayor Casillas Salas and Commissioner Moore may be selected to serve in these positions again or other members of the Authority Board may be selected to serve in these positions; and 20xx-xxx Page 2 of 3 WHEREAS, each of the Chair and Vice Chair will serve as Chair and Vice Chair respectively from the date of his or her election through the date of the first meeting of the Authority in the next succeeding calendar year; provided that each shall serve as Chair or Vice Chair, as applicable, until a successor has been duly selected; and WHEREAS, the other officers of the Authority are currently as follows: Executive Director (District CEO/President and designees), Auditor (City Director of Finance and designees), Treasurer (City Director of Finance and designees), and Secretary (District Clerk and designees)); and WHEREAS, staff recommends that the Authority Board select the Authority Board Chair and Vice Chair, and confirm the designation of the other officers. NOW, THEREFORE, BE IT RESOLVED by the Board of Directors of the Chula Vista Bayfront Facilities Financing Authority (“Authority Board”) as follows: 1. [_______________] is hereby elected to serve as Chair of the Authority. 2. [_______________] is hereby elected to serve as Vice Chair of the Authority. 3. The designation of the following officers is hereby confirmed as follows: a) The Executive Director of the San Diego Unified Port District (“District”) shall be the Executive Director of the Authority; b) The Director of Finance as the City of Chula Vista (“City”) shall be the Auditor of the Authority; c) The Director of Finance of the City shall be the Treasurer of the Authority; and d) The Clerk of the District shall be the Secretary of the Authority. APPROVED AS TO FORM AND LEGALITY: CO-COUNSEL _____________________ Thomas A. Russell, General Counsel, San Diego Unified Port District 20xx-xxx Page 3 of 3 _____________________ Glen R. Googins, City Attorney, City of Chula Vista PASSED AND ADOPTED by the Board of Directors of the Chula Vista Bayfront Facilities Authority, this 13th day of April 2022, by the following vote: DRAFT Page 1 of 4 CHULA VISTA BAYFRONT FACILITIES FINANCING AUTHORITY RESOLUTION 20xx-xxx RESOLUTION AUTHORIZING THE EXECUTION AND DELIVERY OF A LETTER AGREEMENT FOR THE PAYMENT OF LEGAL SERVICES TO CHAPMAN AND CUTLER LLP IN CONJUNCTION WITH THE ISSUANCE BY THE AUTHORITY OF CERTAIN BONDS TO FINANCE A PORTION OF THE COST OF THE CONVENTION CENTER AND THE PHASE 1A INFRASTRUCTURE IMPROVEMENTS FOR THE CHULA VISTA BAYFRONT WHEREAS, the Chula Vista Bayfront Facilities Financing Authority (“Authority”) was formed through that certain Joint Exercise of Powers Agreement between the City of Chula Vista (“City”) and the San Diego Unified Port District (“District”) dated as of May 1, 2014 and filed in the Office of the District Clerk as Document No. 61905 (“Original Authority Agreement”), as amended and restated by that certain Amended and Restated Joint Exercise of Powers Agreement between the City and District dated July 25, 2019 and filed in the Office of the District Clerk as Document No. 70245 (“Authority Agreement”); and WHEREAS, the District and the City (each, a “Member of the Authority”) are the sole members of the Authority; and WHEREAS, the District and the City have been working collaboratively for decades to plan and implement the Chula Vista Bayfront Master Plan (“CVBMP”); and WHEREAS, since 2014, the District and the City have been working to deliver the catalyst project for the CVBMP, an approximately 275,000 net usable square foot convention center (“Convention Center”) and a 1,570 to 1,600 room resort hotel (“Resort Hotel”) to be located on Parcel H3 of the CVBMP; and WHEREAS, RIDA Chula Vista, LLC (“RIDA”) was selected as the developer of the Convention Center and the Resort Hotel through a Request for Qualifications; and WHEREAS, at the early stages, and in light of an overall project cost in excess of $1.1 billion, it was determined that in order for the Convention Center and Phase 1A Infrastructure Improvements to be financially feasible, the City and the District would need to make a “Public Contribution” for the construction of the Convention Center and Phase 1A Infrastructure Improvements; and 20xx-xxx Page 2 of 4 WHEREAS, the Public Contribution consists of approximately $265MM toward the cost of the Convention Center and approximately $85MM toward the Phase 1A Infrastructure Improvements for a total public investment of $350MM; and WHEREAS, the Authority was formed to finance most of the Public Contribution; and WHEREAS, in support of the Public Contribution, the Authority is negotiating with J.P. Morgan Securities LLC (“JPMorgan”) to extend credit to the Authority through the purchase of bonds (“Authority Bonds”) that will be secured by funds provided by the District, the City, and the Bayfront Project Special Tax Financing District (“Special Tax District”); and WHEREAS, in conjunction with the Authority Bonds, JPMorgan engaged Chapman & Cutler LLP (“Chapman & Cutler”) to serve as legal counsel to the lenders, including JPMorgan as the Lead Arranger and Administrative Agent of the Authority Bonds; and WHEREAS, the Authority Board will be considering the approval of a letter agreement with Chapman and Cutler for payment of legal services (“C&C Letter Agreement”) (Attachment A); and WHEREAS, under the C&C Letter Agreement, the Authority agrees to pay Chapman & Cutler’s a maximum of $425,000 if there is a successful financial close no later than May 31, 2022 and a maximum $250,000 if the financial close is not achieved; and WHEREAS, the maximum amounts for the fees can be increased by $75,000 for each month of delay (prorated for any partial month) beyond May 31, 2022; and WHEREAS, if there is an impasse resulting from a requirement of JPMorgan that the Authority, the District, and the City are not legally permitted to do, and the result of that impasse is a failure to achieve a successful financial close, the Authority does not have to pay Chapman & Cutler their legal fees; and WHEREAS, the caps include routine copying charges, postage and internal secretarial services; and WHEREAS, the caps do not include other services, such as travel, filing and search fees; and WHEREAS, staff recommends that the Authority Board authorize the execution and delivery of the C&C Letter Agreement. 20xx-xxx Page 3 of 4 NOW, THEREFORE, BE IT RESOLVED by the Board of Directors of the Chula Vista Bayfront Facilities Financing Authority (“Authority Board”) as follows: The letter agreement from Chapman and Cutler LLP attached hereto as Exhibit A (“C&C Letter Agreement”) is hereby approved and the Executive Director of the Chula Vista Bayfront Facilities Financing Authority, or his designee, is hereby authorized and directed to (1) execute the C&C Letter Agreement in substantially the form presented to the Authority Board at the April 13, 2022 Authority Board meeting and attached hereto as Exhibit A; and (2) deliver the executed C&C Letter Agreement to Chapman and Cutler LLP. APPROVED AS TO FORM AND LEGALITY: CO-COUNSEL _____________________ Thomas A. Russell, General Counsel, San Diego Unified Port District _____________________ Glen R. Googins, City Attorney, City of Chula Vista PASSED AND ADOPTED by the Board of Directors of the Chula Vista Bayfront Facilities Authority, this 13th day of April 2022, by the following vote: 20xx-xxx Page 4 of 4 Exhibit A C&C Letter Agreement (To be attached.) DRAFT Page 1 of 2 CHULA VISTA BAYFRONT FACILITIES FINANCING AUTHORITY RESOLUTION 20xx-xxx RESOLUTION AUTHORIZING CHANGES TO THE DAY AND FREQUENCY OF THE REGULAR MEETINGS OF THE BOARD OF DIRECTORS OF THE AUTHORITY TO ADD MAY 12, 2022 AND MAY 13, 2022 AS REGULAR MEETINGS, AND TO ESTABLISH THE LOCATION OF THE MAY 12, 2022 AND MAY 13, 2022 REGULAR MEETINGS WHEREAS, the Chula Vista Bayfront Facilities Financing Authority (“Authority”) was formed through that certain Joint Exercise of Powers Agreement between the City of Chula Vista (“City”) and the San Diego Unified Port District (“District”) dated as of May 1, 2014 and filed in the Office of the District Clerk as Document No. 61905 (“Original Authority Agreement”), as amended and restated by that certain Amended and Restated Joint Exercise of Powers Agreement between the City and District dated July 25, 2019 and filed in the Office of the District Clerk as Document No. 70245 (“Authority Agreement”); and WHEREAS, the District and the City (each, a “Member of the Authority”) are the sole members of the Authority; and WHEREAS, the Board of Directors of the Authority (“Authority Board”) will be considering a change to the day and frequency of the regular meetings of the Authority Board; and WHEREAS, pursuant to Section 4.C(1) of the Authority Agreement, the Authority Board shall hold its regular meetings at such times and at such locations as may be established by the Bylaws of the Authority or by resolution of the Authority Board; and WHEREAS, the Bylaws of the Authority do not establish a schedule for the regular meetings; and WHEREAS, on December 13, 2021, the Authority Board adopted Resolution No. 2021-004 which provides that the Authority Board shall hold a regular meeting every Wednesday of each month, commencing January 1, 2022, and establishes the location of the regular meetings as the City of Chula Vista located at 276 Fourth Avenue, Chula Vista, California 91910 for the first and third meetings of each month and the San Diego Unified Port District, Don L. Nay Administration Building located at 3165 Pacific Highway, San Diego, California 92101 for the second, fourth, and fifth meetings of each month; and 20xx-xxx Page 2 of 2 WHEREAS, Resolution No. 2021-004 did not change the time of the regular meetings which continues to be 3:00 pm; and WHEREAS, the proposed Authority Board action would add May 12, 2022 and May 13, 2022 as regular meeting dates and such regular meetings would be held at the San Diego Unified Port District, Don L. Nay Administration Building located at 3165 Pacific Highway, San Diego, California 92101; and WHEREAS, staff recommends that the Authority Board adopt the resolution authorizing changes to the day and frequency of the regular meetings of the Authority Board to add May 12, 2022 and May 13, 2022 as regular meetings and to establish the location of the May 12, 2022 and May 13, 2022 regular meetings. NOW THEREFORE, BE IT RESOLVED by the Board of Directors of the Chula Vista Bayfront Facilities Financing Authority (“Authority Board”) as follows: May 12, 2022 and May 13, 2022 are added as regular meetings of the Authority Board and the May 12, 2022 and May 13, 2022 regular meetings will be located at the San Diego Unified Port District, Don L. Nay Administration Building located at 3165 Pacific Highway, San Diego, California 92101. The meeting time of all regular meetings will continue to be at 3:00 pm. APPROVED AS TO FORM AND LEGALITY: CO-COUNSEL _____________________ Thomas A. Russell, General Counsel, San Diego Unified Port District _____________________ Glen R. Googins, City Attorney, City of Chula Vista PASSED AND ADOPTED by the Board of Directors of the Chula Vista Bayfront Facilities Financing Authority, this 13th day of April 2022, by the following vote: DRAFT Page 1 of 3 CHULA VISTA BAYFRONT FACILITIES FINANCING AUTHORITY RESOLUTION 20xx-xxx RESOLUTION MAKING FINDINGS REGARDING VIRTUAL MEETINGS OF THE BOARD OF DIRECTORS OF THE CHULA VISTA BAYFRONT FACILITIES FINANCING AUTHORITY IN ACCORDANCE WITH THE RALPH M. BROWN ACT AND CALIFORNIA ASSEMBLY BILL 361 WHEREAS, the Chula Vista Bayfront Facilities Financing Authority (“Authority”) was formed through that certain Joint Exercise of Powers Agreement between the City of Chula Vista (“City”) and the San Diego Unified Port District (“District”) dated as of May 1, 2014 and filed in the Office of the District Clerk as Document No. 61905 (“Original Authority Agreement”), as amended and restated by that certain Amended and Restated Joint Exercise of Powers Agreement between the City and District dated July 25, 2019 and filed in the Office of the District Clerk as Document No. 70245 (“Authority Agreement”); and WHEREAS, the District and the City (each, a “Member of the Authority”) are the sole members of the Authority; and WHEREAS, pursuant to Section 4.C(1) of the Authority Agreement, the Authority Board shall hold its regular meetings at such times and at such locations as may be established by the Bylaws or by resolution of the Authority Board; and WHEREAS, the Bylaws of the Authority do not establish a schedule for the regular meetings; and WHEREAS, on December 13, 2021, the Authority Board adopted Resolution No. 2021-004 which provides that the Authority Board shall hold a regular meeting every Wednesday of each month, commencing January 1, 2022, and establishes the location of the regular meetings as the City of Chula Vista located at 276 Fourth Avenue, Chula Vista, California 91910 for the first and third meetings of each month and the San Diego Unified Port District, Don L. Nay Administration Building located at 3165 Pacific Highway, San Diego, California 92101 for the second, fourth, and fifth meetings of each month; and WHEREAS, Resolution No. 2021-004 did not change the time of the regular meetings which continues to be 3:00 pm; and WHEREAS, California Assembly Bill 361 (AB 361) enacted certain exceptions to the Ralph M. Brown Act (Brown Act) to allow virtual and hybrid meetings of the public agencies when there is a proclaimed state of emergency 20xx-xxx Page 2 of 3 and state or local officials are recommending measures to promote social distancing; and WHEREAS, the April 13, 2022 Authority Board meeting will be held at San Diego Unified Port District, Don L. Nay Administration Building located at 3165 Pacific Highway, San Diego, California 92101; and WHEREAS, on March 4, 2020, the Governor of California declared a state of emergency related to COVID-19 which still remains in effect; and WHEREAS, the District declared a state of emergency on March 18, 2020 which remains in effect; and WHEREAS, in addition to other social distancing recommendations by state, federal, and local agencies, on September 23, 2021, Wilma J. Wooten, the Public Health Officer for the County of San Diego, issued a Health Officer Teleconference Recommendation which recommends continued virtual Brown Act meetings to help prevent the spread of COVID-19; and WHEREAS, staff recommends that the Authority Board adopt the resolution making the finding that, based on continued state, federal, and local recommendations for social distancing, the meetings of the Authority Board held in accordance with the Brown Act are permitted to use the exceptions to Brown Act rules set forth in AB 361; and further, that this authorization expires if not renewed at the following regular meeting of the Authority Board that is not cancelled. NOW THEREFORE, BE IT RESOLVED by the Board of Directors of the Chula Vista Bayfront Facilities Financing Authority (“Authority Board”) as follows: The Authority Board hereby finds that, based on continued state, federal, and local recommendations for social distancing, the meetings of the Authority Board held in accordance with the Ralph M. Brown Act (“Brown Act”) are permitted to use the exceptions to Brown Act rules set forth in California Assembly Bill 361; and further, that this authorization shall expire if not renewed at the following regular meeting of the Authority Board that is not cancelled. APPROVED AS TO FORM AND LEGALITY: CO-COUNSEL _____________________ Thomas A. Russell, General Counsel, San Diego Unified Port District 20xx-xxx Page 3 of 3 _____________________ Glen R. Googins, City Attorney, City of Chula Vista PASSED AND ADOPTED by the Board of Directors of the Chula Vista Bayfront Facilities Financing Authority, this 13th day of April 2022, by the following vote: